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GameStop Corp. Message Board

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  • spanxds spanxds Jan 16, 2008 5:51 PM Flag

    For those 'who can accept' the potential for a 19% return...

    Flyer, only my point to the OP (original post) was to you. I'm not saying that covered calls are a bad strategy compared to owning the stock. I was merely pointing out that there is no such thing as a guaranteed 19% return. You seem to discount entirely the possibility that this stock (GME) could fall to half of its current value.

    In a recession scenerio, how much value is there in owning a stock that has never paid a dividend and is trading at a 36 trailing P/E ... especially if the E starts to shrink or becomes negative? If we go into a serious recession, that is VERY possible and should not be ignored when considering your covered call trade.

36.01-0.63(-1.72%)Nov 27 1:01 PMEST